⚒️ Cryptocurrency Knowledge -- Bitcoin & Fiat Currency: Who Will Be the Main Character of Future Money?
1. Inflation:
Fiat Currency: Issued by central banks, total supply is not fixed, can be issued at any time, easily leads to inflation, purchasing power declines over time.
Bitcoin: Total supply is fixed at 21 million coins, cannot be issued more, theoretically does not experience inflation, is a scarce asset.
2. Anti-counterfeiting:
Fiat Currency: Prevented from counterfeiting through complex anti-counterfeiting technologies (such as watermarks, inks, etc.), but there have still been cases of counterfeiting in history.
Bitcoin: Based on blockchain encryption technology, no counterfeiting has been reported so far, with extremely high security.
3. Transfer efficiency:
Fiat Currency: Physical payments, low efficiency for remote and cross-border payments, high costs.
Bitcoin: Convenient transfers, fast cross-border transactions with low fees, only a small Gas fee is required.
4. Physical attributes:
Fiat Currency: Has physical volume and mass, carrying a large amount of cash is inconvenient, and it can wear out or be damaged.
Bitcoin: Has no physical form, easy to carry and divide, the smallest unit is “satoshi (sats)”, will not wear out or depreciate.
5. Consensus and popularity:
Fiat Currency: Widely used globally, strong consensus, is a mainstream payment method.
Bitcoin: Currently still niche, but consensus is gradually expanding, especially in some Western countries.
What does the future hold for Bitcoin?
📕 Bitcoin is only 16 years old, still in its infancy, and the future is full of uncertainty. Currently, Bitcoin's development shows polarization: Western countries like the United States are relatively friendly towards cryptocurrencies, even witnessing the “phenomenon” of Trump personally issuing coins; while here, the attitude towards cryptocurrencies is relatively cautious, mainstream media reports are rare, and the number of participants is also small.
📕 Will Bitcoin replace fiat currency?
No. Bitcoin's fixed supply cannot be used to regulate the economy through monetary policy, which contradicts the government's means of maintaining economic stability. However, Bitcoin has great potential as a store of value, and its market value is approaching 1/10 of gold.
📕 Personally, I believe Bitcoin will not replace fiat currency but will coexist with it. It may become a symbol of digital wealth, much like gold's status in the traditional world. Regardless of what the future holds, Bitcoin's journey has just begun and deserves our continued attention.
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